2020 Legislative Preview

Legislative Preview

Rep. Anne Donahue

January 6, 2020

A new legislative session is beginning, and it will be tough to provide any kind of succinct overview of what to expect when so much is already underway halfway through the biennium. The most prominent economic issues are the debates on a minimum wage increase and paid family leave, plus our aging and shrinking population and its impact on our state budget. (Read: the affordability crisis.) Climate change will be high on the list of other issues. Controversies are also likely on marijuana and criminal justice initiatives.

So to start: the economic ones.

As Vice-Chair of the Health Care Committee, I can’t help but see the deep interconnections between wages, the family leave proposal, and access to health care. The deepest economic inequity we face is the huge variations in that access, yet our focus is on two areas that increase the risks of economic disparities.

What good is a minimum wage increase if someone gets minimal or no health coverage at work and can’t afford coverage or must pay premiums that far exceed that wage increase? Note that those least likely to have insurance via their job are those employed at small businesses, where employers struggle the most with costs and wages. Some will certainly reduce health coverage support to meet a higher minimum wage; some will cut jobs.

What good is family leave if it is paid out of one’s own salary?  Smaller employers with lower wage earners are least likely to be able to voluntarily contribute to the cost, particularly if they have just also been hit with a minimum wage increase.

And what good is the family leave  a person is required to pay for if they are not able to take advantage of it because their job is not protected when they want to return to work, because their small employer is exempt from holding their job open?

What good is the ability to stay home with an ill spouse if the spouse cannot get adequate medical treatment? What good is either a wage increase or family leave if it results in losing a benefit that provides greater support to the family, such as food stamps or health care subsidies?

I think it is critical is to focus first on equalizing access to health care before new benefits, and to support that focus by tying minimum wages to employer health care support. The creation of the job-health insurance link for financing health care was the fundamental accident of history that we are now so challenged in reversing. Let’s not make it worse by creating a new and similar program. And note that a voluntary paid family leave program is even worse because it further expands inequity based on employee bargaining power.

Our very poorest get Medicaid; the wealthy get health coverage through their jobs, or at minimum, it’s much lower as percentage of income; it is the lower middle to middle wage earners that are hit hardest. They may be getting more than minimum wage, but real earnings are hurt far more by health care costs. That’s why the earning “cliff” is so steep: lost benefits exceed wage increases. So despite good intentions, family paid leave and minimum wage increases without addressing financial access to health care potentially contributes to the very thing they seek to reverse:  the rich get richer, the poor get poorer.

Equity and affordability. Overly simplistic, but if, in concept, we took the net economic cost of minimum wage increases and paid family leave, and put it all into health care access, it would go a huge way towards greater financial equity. I want, at a minimum, to see greater connection between minimum wages and existing employer contributions to health care before supporting a blanket minimum wage increase.

When it comes to affordability, we hit broader topics as well. As we face a shrinking tax base both through an aging demographic and out-migration, we will have an ongoing battle to keep Vermont affordable while meeting our needs, for everything from roads to schools. As with so many subjects, our small size as a state dictates that we be compared with states around us. No amount of cash enticements will draw in new folks if they will lose out in relative income for years thereafter because of our high tax burden.

We have to stop ignoring the fact that we are outliers in taxing Social Security benefits and veterans’ retirement benefits. (We exempted low income Social Security from taxation two years ago, which was a good thing, but which ignores the fact that we need to help high income beneficiaries opt to stay in Vermont, as they still pay taxes on other income.) Taxing veterans’ retirement is a barrier to recruiting these highly trained folks to come to work here.

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On climate change, which will be front and center in many minds in Montpelier this year: I don’t think the debates much matter as to why the world’s climate is changing, or even how fast  or by how much it is or is not happening. The most minimalist outlook has to recognize that there will be significant impacts, and that we have an obligation to protect our environment for future generations.

The question is, how much we want to do to try to shift course – recognizing both our small role but also our responsibility to do our share. What are we willing to contribute – how much a priority? I have always fiercely opposed a “carbon tax,” primarily because – like with single payer health care, or even minimum wage – we are too small a state to take on the economic impact of a major change standing alone.

We now have the potential for a major regional collaborative among northeastern states to address transportation-based emissions. We do a lot already in Vermont on addressing heating fuel consumption through efficiencies, but not so much on the leading cause of CO2, which is from transportation. Electric car purchases aren’t going to put much of a dent in that, at least not for a while.The importance of a regional collaborative is that it doesn’t place us as a huge economic disadvantage with our competing neighbor states, adding to unaffordability on a comparative scale (which is where it most matters.)

The regional collaborative is already being attacked as “just another carbon tax” in a package that makes it look like something different. I don’t know enough about it yet to assess that, but I do note that we already use a “carbon tax” for heating efficiency: it’s the surcharge on our electric bills that pays for all the home heating incentives and supports provided through Efficiency Vermont.

So regardless of how it gets labeled, what will need to be assessed is what the cost-benefit trade-offs will be, and how equitably the costs will be shared. I will be looking forward to learning the details. I think it may be a very positive opportunity.

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Other issues on the immediate horizon include marijuana (whether to move from unregulated legal possession, to regulated legal sales and possession), and responses to concerns about the outcome when people are found not guilty of a crime based on insanity.

In concept, my feelings about marijuana have been to leave people alone when they are using small amounts of pot in private. Despite that conceptual support, I didn’t vote for our legalization bill a few years ago because it was too weak on protections against increased impaired driving and exposure to children. I’ve come to recognize that this “libertarian” perspective may not make sense on this issue. Legal possession without legal sales maintains the illegal market with all of its negative implications and doesn’t allow for state oversight. But the devil will still be in the details when it comes to a final proposal.

A second lurking issue is legislative response to the outrage regarding three individuals accused of murder or attempted murder who had charges dismissed last year in Chittenden County because the state’s attorney believed they had clearly established insanity defenses. I have always hated reactive law – laws passed to address a narrow issue based on a suddenly perceived crisis. Such laws tend to be debated out of context of broader public policy; they isolate one issue in a way that may be unwisely disconnected from other laws.

We have significant challenges in the ways we currently address the overlap of systems when someone is involved in serious crimes and is also in need of psychiatric treatment. I have a bill sitting “on the wall” that looks at this issue. (Sitting on the wall, in our jargon, means it’s been introduced but not taken up in committee.) It is a very complex area of law that needs attention. What it doesn’t need is a quick-fix approach that addresses only one narrow piece, based on one set of facts.

In whatever way we attempt to go forward, it bothers me deeply when I hear people say that we need to have automatic minimum stays in a locked psychiatric hospital for people who are not in prison because of being found not guilty by insanity. Pardon me? Lock people up when they were never convicted of a crime? “We know they did it” doesn’t work for me as a basis for depriving people of their freedom. We need to respect the constitution.

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Feel free to get in touch any time during the session with Rep. Goslant and me. There is a lot more going on than we can summarize, so if you have questions about something – ask. We are buried in committee work and don’t always know what is happening in other committees, but we can find out for you. It is an honor to serve you. (kgoslant@leg.state.vt.us; adonahue@leg.state.vt.us)